Kiva’s Investment in Non-Traditional Loan Products

By Irene Fung | KF19 | India

Water and Sanitation may not be the first issue that people associate with Kiva.  Entrepreneurs scoop up most of the headlines in micro-finance, but when it comes to alleviating poverty, other less publicized loan products are equally important. In fact, Kiva is committed to increasing peoples’ access to financial services to facilitate the development of water and sanitation, a key development challenge.

India has felt this challenge acutely with 67% of the rural households lacking any access to sanitation facilities. In Odisha, India – where I’m serving as a Kiva fellow – an alarming 78% of households have no sanitation coverage.  Rural areas fare even worse: close to 85% of households have no access to sanitation facilities.  This has severe consequences to the health and well-being of communities across the state.  Water contamination, typically the result of open defecation, leads to diarrhea and cholera.  These diseases remain the leading causes in children’s death in India.

New Folder

Pit Toilet Construction

I have been working with Kiva’s Indian partner, Mahashakti Foundation, in Western Odisha.  Over the course of the last few weeks I have travelled to various villages with Mahashakti staff, meeting with borrowers and learning about Mahashakti’s loan programs, including their water and sanitation initiative.

During these visits, some of the women shared with me feelings of concerns and vulnerability, drawing attention to the insecurity that they and their daughters face when having to venture outside the house. The cold, rain, insects, animals and other natural elements make for an uncomfortable excursion, and sneers and jest from passing men have caused much anxiety.  These concerns are obviously amplified during the night.

It seems like there is some demand for toilets from the villages, then why is the uptake of sanitation facilities in Odisha so low? While more people, especially women, are recognizing the importance of sanitation facilities, the majority of villagers are slow to consider this a priority.  Over the last few weeks with Mahashakti I have learned just how complex this issue is.

Communities often do not make the direct linkage between infectious diseases and water contamination through open defecation.  While visiting the villages, I’ve noticed that the community pond is used for a number of things, bathing, dish washing, even drinking and feeding their animals.  It is also common for people to defecate near the pond.  This is especially problematic during monsoon season, when the water level rises, flooding the fields and contaminating water sources. There are also some cultural believes that places of defecation should be far away from the gods and goddesses in homes, making a toilet inside the home undesirable.

What is being done about this issue?  In 1999, the Government of India launched a nation-wide campaign to increase sanitation coverage across the states and provide health education.  In conjunction with this campaign, Mahashakti has spearheaded its own water and sanitation program, spreading awareness about safe water drinking practices and sanitation through community meetings and village studies.

In addition, borrowers can apply for a loan of 20,000INR, roughly 400USD, to construct a pit latrine.  The organization also provides technical training to local masons to construct low-cost quality toilets, technical support throughout the construction period, and workshops that provide instructions on the proper cleaning techniques including simple home-made cleaning products.  With a holistic approach, Mahashakti hopes to promote long-term behavioral change.


Mahashakti Awareness Workshop

It’s not easy to talk to someone you have just met about their toilet facilities, but Jyostna who has received a Mahashakti sanitation loan, was open to talk to me about her new toilet.  Jyostna has been a Mahashakti business borrower for a few years.  Mahashakti provided her loans to expand her bicycle repair shop.  She lives in a small village in the Rayagada District with her husband and 2 sons.  In her small village of about 250 households, fewer than 10 households have private toilets.  As long as Jyostna can remember, she and the people from her community have always had to go to the fields, one for women, and a separate for men.

She attended a Mahashakti water and sanitation awareness meeting and learned about the diseases born from water contamination, hygiene and safe water drinking practices.  Mahashakti was promoting a new loan product to construct toilets and Jyostna decided that her family would benefit from this opportunity.


Jyostna in front of her new toilet

Since her family has constructed the toilet, 4 other households in the village have expressed interests in constructing a toilet in their homes as well.  She told me, “It was helpful to us to construct this toilet.  My children are not going outside, they are using the toilet and they are clean.  I don’t have to go outside and I can stay peacefully in my house, free from the insects and mosquitoes.”

While Mahashakti is offering one answer to this complex issue in Western Odisha, there remains a long road ahead.  Kiva is committed to work with field partners across the world to develop and scale innovative loan products.  Learn more about Kiva’s work in water and sanitation.  Please continue to support Mahashakti and other Kiva field partners that strive to provide important, locally minded solutions.

About the author

Irene Fung

Originally from Hong Kong, Irene grew up in Los Angeles, California. She has worked with several non-profit organizations that provide financial services to vulnerable groups and she is committed to building economically equitable and sustainable communities. She is especially interested in financial inclusion issues to the most marginalized. Irene received a master's degree in Urban Planning from the University of Southern California and a bachelor's degree in Economics from the University of California, San Diego. Irene has studied and lived in China, Indonesia, and England and is excited to be adding India to the list. She served with KF19 in India and will be working with two partners in Indonesia.